Leaf electric cars to get improved battery warranty

DETROIT -- Nissan said it will offer to replace some poorly performing batteries on its Leaf electric car and improve warranty coverage for the battery systems for its almost 20,000 U.S. owners.

The move comes as the Japanese automaker closes a year marked by disappointing sales and complaints by some U.S. customers about the Leaf's battery capacity.

Nissan will repair or replace lithium-ion batteries that have fallen under a specified capacity as well as expand the warranty on the battery to cover for lost capacity for the first five years or 60,000 miles, Executive Vice President Andy Palmer said in a post on an online owners' forum on Thursday.

"Our actions today are intended to put customer minds at ease regarding the topic of battery capacity loss," Palmer said in his letter.

Nissan's actions also will apply globally, and the company will notify owners in the coming months in other markets, he added. The program will be rolled out at U.S. dealers next spring.

Nissan is falling well short of its goal of doubling Leaf sales in the company's current fiscal year, which runs through March 2013. Demand in the United States is particularly weak, with sales through November down 4.5 percent at 8,330 cars.

Leaf is not the only electric vehicle to struggle in the U.S. market. General Motors Co's Chevrolet Volt plug-in hybrid car has come up short of expectations, previously forcing the U.S. automaker to idle the plant that makes the car. However, Volt sales are two-and-a-half times those of the Leaf so far this year.

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Since the Leaf's debut in December 2010 in Japan and seven U.S. metropolitan areas, Nissan has sold more than 43,000 of the EVs globally. But so far this fiscal year, Leaf's global sales are up only 25 percent to 18,226, and Chief Executive Carlos Ghosn has acknowledged that achieving the goal to double sales to about 40,000 vehicles would be difficult.

Palmer said Nissan's engineers have worked to ensure the Leaf batteries were operating as specified. However, the company agreed previously to buy back about 10 EVs from unsatisfied customers, mostly in Arizona where several owners had voiced dissatisfaction in online forums over the energy storage capacity of the batteries.

Nissan previously said the Arizona drivers were operating their cars beyond company recommendations, using and recharging their batteries at a faster rate than most Leaf drivers and causing the batteries to lose capacity quicker than indicated in the manual.

"We know that some of you have not been satisfied with the pace of our support activities," Palmer said to the owners. "We want to take actions which will further improve our customers' satisfaction with their Nissan Leafs."

The capacity loss coverage for the battery is on top of the car's normal three-year, 36,000-mile warranty, as well as the battery's eight-year, 100,000-mile coverage for defects, he said. It protects against capacity loss in batteries that fall below nine of the 12 bars displayed on the car's battery capacity gauge.

A vehicle whose battery has nine bars remaining is retaining about 70 percent of its original battery capacity.

For those whose batteries have fallen below nine bars during the coverage, Nissan said it will repair or replace the battery with a new or rebuilt battery to restore capacity at or above nine bars, Palmer said.

Nissan said the specifics of the new warranty will be communicated to each owner early next year and will apply to the 2013 model upon its U.S. release in the first quarter, as well as to 2011 and 2012 models. Nissan also said it expects the "great majority" of Leaf owners will not have to use the enhanced warranty.

The Leaf is in its first generation. Nissan has not said when it will introduce the second generation, but the company has improved the 2013 model's driving range by 14 percent and lowered the price tag.

Nissan officials said changes in the remodeled EV, which went on sale in Japan last month, were based on comments from customers who voiced fears of being stranded by a vehicle that ran out of electric charge.

Production of the 2013 Leaf began at the company's Smyrna, Tennessee, plant this month, while battery assembly at an adjacent factory started in November. Before this month, the Leaf was built only in Japan.